What''s the purpose of the exchange offer

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Reference no: EM131003553

Read the attached case and answer the following questions in paragraph form:

1. Why was Newfield restructuring its business in 2013? What are the merits of the divestitures?

2. What's the financial health of Newfield? Why was the company cutting its dividend?

3. What's the purpose of the exchange offer?

4. What type of option is embedded in the new security. What are the major components of valuing the new security? How would you price the newly issued preferred stock?

5. How would you evaluate the tradeoff between accepting the new preferred stock and keeping the common stock?

6. As an institutional investor would you accept the offer or sell the common and ignore the offer altogether?

7. What's the likely net effect of the whole set of announcements on the stock price?

Attachment:- newfield_energy.pdf

Reference no: EM131003553

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